Economy News

Subsidy Support for Foreign-Invested Enterprises in 2017

02/23/2017SMG4539

In accordance with Article 14 of the Foreign Investment Promotion Act (FIPA), Article 20 of the FIPA Enforcement Decree, Article 15 and 16 of the Seoul Metropolitan Government (SMG) Ordinance on Support for Foreign Investment, we hereby offer notification of the plan, outlined below, to provide subsidies for employment, education, and training for foreign invested enterprises in Seoul Metropolitan City in 2017. Eligible companies are kindly requested to submit an application for subsidy in accordance with the following.

February 16, 2017

Mayor of Seoul Metropolitan City

■ Eligibility period: 1.1.2016 ~ 12.31.2016

■ Eligibility and Requirements

○ Eligibility: Foreign investment projects attracted by the SMG or foreign-invested enterprises that invest in new growth industries designated by the SMG

– New recruitment and training should take place within five years of the date of foreign-invested enterprise registration or within five years of the date of an increase in investment.

– Companies whose total number of regular employees increased by more than 10 from the previous year (2015) through new recruitment in 2016 (or, companies whose total number of regular employees is more than 10 for those newly founded in 2016) ※ Applies only to Korean nationals employed as of the date of application

◆ Regular employee: A person who provides labor to a company for the purpose of a wage and who meets one of the following (except for non-regular workers, as specified in Article 2, Paragraph 1 of「Act on the Protection, etc. of Fixed-term and Part-time Workers」, who have signed labor contracts of less than 1 year, or short-term laborers as specified in Article 2, Paragraph 1, Clause 8 of「Labor Standards Act」)

1. Average number of persons earning wages from the most recent one year stated on the income tax withholding report, which was submitted to the local tax office in accordance with Article 185, Paragraph 1 of 「Enforcement Decree of the Income Tax Act」

2. Average number of persons from the most recent one year with certified records of employer contribution and employee contribution in accordance with Article 3, Paragraph 1, Clause 11 and 12 of「National Pension Act」 (excluding individually insured persons in accordance with Article 9 of the same act)

3. Average number of persons from the most recent one year with certified records of insurance contributions in accordance with Article 69 of「National Health Insurance Act」 (excluding individually insured persons in accordance with Article 6 of the same act)

– As of the application date, a corporation with a foreign investment ratio of over 30 percent

※ Excluding shares (stocks) of foreign companies held by Korean nationals and corporations

– Companies that completed education and training at qualified job training institutions, as per the Vocational Education and Training Promotion Act, for new employees hired in 2016

■ Subsidy amount

○ Up to KRW 400 million per company (Maximun KRW 200 million for employment subsidy + Maximun KRW 200 million for education and training subsidy)

– For each employee exceeding 10 newly hired employees: up to KRW 1 million per employee for up to six months

○ Total subsidy budget: KRW 480 million

※ Even if the number of applicants exceeds the budget amount, the provided support must remain within the budgetary limit.

■ Application

○ Period: February 16 – April 28, 2017

○ Method: In person or via regular mail or email (valid if postmarked by deadline)

■ Fulfillment of conditions

○ A separate account to receive and spend the subsidy should be set up, and be used only for personnel expenses (employee salary, bonus, welfare expenses, etc.).

○ For the first three years including the year in which a subsidy is applied for, a company receiving the subsidy shall maintain the number of regular employees and more than 30% of foreign investments as the previous year of subsidy application (2016)

※ In the case one of the following occurs, the entirety or portion of a subsidy that has been decided to be issued may be cancelled and, according to this cancellation, the subsidy is to be rescinded

– If the above mentioned conditions for subsidy support are violated

– If a subsidy is received through a false registration or other illegal meansv

– Relocation of business place to other cities or provinces

■ Others

○ For further inquiries, please contact an officer with the Investment Promotion Division of the SMG. (☏02-2133-5356, ks.moon@seoul.go.kr)

Standard classification of new growth industries
to support foreign-capital invested companies in Seoul

Standard classification of new growth industries to support foreign-capital invested companies in Seoul

Category

Industry Code and Name

1. IT convergence

261 Semiconductor manufacturing industry

262 Electronic part manufacturing industry

263 Computer and peripheral device manufacturing industry

264 Communication and broadcasting equipment manufacturing industry

265 Video and sound device manufacturing industry

2918 Office machinery and device manufacturing industry

58221 System software development and supplying industry

58222 Applied software development and supplying industry

62010 Computer programming service industry

62021 Integrated computer system counseling and establishment service

62022 Computer facility management industry

62090 Other information technology and computer operation-related service industry

63111 Data processing business

63120 Portal and other Internet information media service industry

63991 Database and online information provision industry

63999 Other information service industry

2. Digital contents industry

33402 Video game machine manufacturing industry

58211 Online and mobile gaming software development and supplying industry

58219 Other gaming software development and supplying industry

59111 General film and video production industry

59112 Animated film and video production industry

59113 Commercial film and video production industry

59114 Television program production industry

59120 Film, video and television program production-related service industry